It has been found that millennials’ financial knowledge has increased dramatically over the last few years. Millennials go to great lengths to ensure their financial futures, from focusing on savings to making wise investments. A healthy Credit score is one essential feature that can help millennials be more financially responsible.
(CIBIL keeps track of all of your credit-related activity.) The CIBIL score, often known as a credit score, is calculated based on the amount of credit you take out and your repayment history. The CIBIL score is a number that goes from 300 to 900. You should constantly strive for a high CIBIL score. Because most lenders check your CIBIL score before approving your loan application, this is the case. Lenders may consider you a low-risk applicant if your CIBIL score is 750 or higher, and your loan application will be approved quickly. A high CIBIL score may also qualify you for a larger loan amount at a lower interest rate. Let’s take a look at some key actions that can assist you maintain a healthy CIBIL score.
Make on-time payments on your existing debts
If you have any outstanding loans, make sure you pay them off within the agreed-upon time frame. Pay your monthly installments on time, as late payments can lower your CIBIL score. Manage your monthly budget effectively to avoid defaulting on your EMIs. Repayment on time might help you steadily improve your CIBIL score.
Pay off all of your debts
To maintain a strong CIBIL score, you must pay off all of your existing debts. If you have a lot of debt, you might want to consider consolidating it with a personal loan. You will not only be able to pay off your debts fast and easily, but you will also be able to save a significant amount on interest costs.
Reduce your credit utilization ratio as much as possible.
The ratio of the credit you use to the overall credit limit is known as your credit utilisation ratio. You should make every effort to keep it as low as possible. By judiciously utilising your credit card and increasing your credit limit, you can reduce your credit use percentage. Maintaining a healthy credit score requires a low credit use ratio.
Have a good credit mix
Maintaining a decent credit score can also be aided by having the correct mix of secured and unsecured loans. However, after you have obtained the loan or best credit cards in India, your primary responsibility should be to repay it on schedule.
Examine your CIBIL score
Ensure that your CIBIL score is kept up to date. You may find out your CIBIL score by going to the CIBIL website. You’ll need to get your CIBIL report to see your CIBIL score. Make sure your CIBIL report is error-free, as any errors can lower your CIBIL score. You can check your CIBIL score for free once a financial year, according to RBI norms.
Now that you’re aware of the numerous ideas and tactics for maintaining a good CIBIL score, make an effort to improve your CIBIL score before applying for any loan.
The steps to check your CIBIL score are as follows
- Visit the official CIBIL website, select “check CIBIL score,” and enter the relevant information.
- An OTP will be sent to your registered email address and mobile number.
- By confirming the OTP, you must authenticate your identity.
- You will be able to read your comprehensive financial health report, which includes your CIBIL score, after confirming your identification.
